May v. Flint

• Decision Date: 13 June 1891
• Citation: 16 S.W. 575
• Parties: MAY v. FLINT <I>et al.</I>
• Court: Arkansas Supreme Court

Page 575

16 S.W. 575

MAY v. FLINT et al.

Supreme Court of Arkansas.

June 13, 1891.

Appeal from circuit court, Johnson county, GEORGE S. CUNNINGHAM, Judge.

Sol. F. Clark, for appellant. John M. Rose, for appellees.

HEMINGWAY, J.

The appellant relies upon a plea of usury to defeat a mortgage. It is not claimed that the lender received, or contracted to receive, directly, excessive interest; but a commission was received by an intermediary, and this, it is contended, made the loan usurious. The question then is, was the commission paid a part of the interest? To affect a loan with usury on account of a commission paid to an intermediary, it must appear that he was the agent of the lender, and took the commission under authority, express or implied, from his principal. There is no proof of an express delegation of authority in this case; and, if the appellant's contention can be sustained, it must be upon an implied authorization. The direct proof in the case is that the intermediary was not the agent of the lender; that he was a broker, engaged in procuring loans for borrowers who sought his services; and that in procuring loans, as in this case, he acted as the agent of the borrower. Such is the direct testimony of the lender as well as of the broker. Is it overcome by the circumstances in proof? The appellant contends that it is, and relies upon our finding in the Banks Case, 54 Ark. ___, 16 S. W. Rep. 477. In that case we disregarded the positive statements of some witnesses as to the broker's relations towards the parties, because we found such statements to be in irreconcilable conflict with other conceded facts. From the circumstances we found that the broker had solicited business and performed services for the lender; that this had been done in a similar manner for a number of years, to the extent of almost all the lender's business; and that it was clearly implied from the circumstances that it was in pursuance of an agreement or understanding with the lender. Upon this we held that an agency existed. Such an understanding is not implied from the proof in this case, for there is no proof that the relations between the broker and lender were intimate, and, for aught that appears, this was the first transaction between them, and it was brought about by the broker at the solicitation of the borrower. As such is the state of case, we think the court's finding followed the proof, and that this case is controlled by Baird v. Millwood, 51 Ark....